The article below is based in current events today, aimed at our hemisphere, but also summarizes nicely the main benefits of free trade, what I call freedom to trade - a basic economic freedom. Key points:

1) "There are a billion new consumers that are going to join the middle class in Asia over the next 10 years. We have to have access to them." In other words, with free trade, whatever you invent or innovate or design or build or just source and sell, the larger the market you can sell into the more return you can earn for your effort.

2) 'access to imports is a key contributor to high U.S. living standards'. Freedom to buy from far away means the freedom to make the best possible purchase transactions available. Besides standard of living, this is a key component in competitiveness.

3) Trade war escalations: "If the U.S. puts up new trade barriers to China and attaches "buy American" provisions to federal spending—as the Obama administration did in 2009 and now wants to do again—other countries are likely to feel justified in moving to protect their own domestic markets." As with the leadup to the Great Depression, protectionism at home leads to other countries doing the same, and trade wars destroy economies, commerce and wealth.-----http://online.wsj.com/article/SB10001424052970203476804576616760650005304.html?mod=WSJ_Opinion_LEADTop

The Case for Free-Trade Leadership WSJMexico's growth in investment and trade, both imports and exports, shows the benefits of open borders.

By MARY ANASTASIA O'GRADY

'There are a billion new consumers that are going to join the middle class in Asia over the next 10 years. We have to have access to them."

That was General Electric CEO Jeff Immelt on CNBC Thursday responding to a question about the Senate's 79-19 vote last week to advance a bill that would punish China with antidumping duties if it does not strengthen the yuan.

Bipartisan Washington, as indicated by that vote, is itching to launch a trade war with China. Mr. Immelt warned against it: "Make no mistake. The U.S. will do better if we have a good strong positive engagement with China. I was there last week. It is still growing eight to ten percent. We need to have access to China for our exports."

Too bad President Obama didn't say that.

There is no such thing as a good moment to close markets, but this would seem to be an especially inauspicious time, just as Asians are climbing up the economic ladder, to introduce a policy that is likely to generate reciprocal penalties against U.S. exporters.

But that is only one reason the Senate bill is dumb. The chief reason is that access to imports is a key contributor to high U.S. living standards and American export competitiveness.

A third factor, less often recognized, has to do with the need for U.S. leadership in reaching wider geopolitical goals. If the U.S. puts up new trade barriers to China and attaches "buy American" provisions to federal spending—as the Obama administration did in 2009 and now wants to do again—other countries are likely to feel justified in moving to protect their own domestic markets.

The unintended consequences of a U.S. shift toward protectionism are not hard to predict. Brazil is already loudly complaining about pressure on local industry due to currency weakness abroad—meaning the U.S. dollar. In September it raised duties on some auto imports by 30 percentage points.

Closer to home, Mexico remains vulnerable to internal protectionist forces. Amazingly, the country has stuck to a liberal trade agenda in recent years despite the impact on exports from the 2009 U.S. recession and strong competition from China. But a World Trade Organization commitment it made in 2008 to lift all antidumping duties on some 1,500 Chinese goods this December is stirring up protectionist sentiment. Presidential and legislative elections slated for July will give nationalist populists an opportunity to strike.

The Bombardier manufacturing facility in Queretaro, Mexico

Sensational press coverage of Mexico's narco-violence has obscured the exciting story of the changing economic landscape brought on by openness. In an October economic analysis of the economy, the Spanish bank BBVA says that in 2010 Mexico was among the top 10 destinations in the world for foreign direct investment, which grew almost 22%.

BBVA found that the "main attraction" for that capital was Mexico's "platform" as an exporter of manufactured goods (over $246 billion in 2010) but also as an importer of manufactured goods ($250 billion). Those figures, BBVA said, "place Mexico as one of the economies most open to foreign trade and with the greatest trade activity internationally."

This has allowed Mexico to move up the food chain as a producer. One fascinating development is its evolving role in the global aerospace industry. Using data from the Boston Consulting Group, BBVA found that "in the aerospace category, [Mexico] is the main recipient [in the world] of FDI."

Baja California is home to 52 of the 232 aerospace companies in Mexico today and 40% of the industry's work force. Honeywell and Gulfstream are two household names that have facilities there. In Chihuahua, Cessna manufactures aircraft wiring sets (called harnesses) and ships them to Kansas for airplane assembly while Bell Helicopter manufactures cabins for commercial units. Jalisco is also an aerospace hotspot, with projects "in place," according to the Mexican-government publication Negocios, for "producing engine components, wiring harnesses, cables, landing system components and heat exchangers." By attracting the Canadian firm Bombardier in 2006, the state of Queretaro has pulled in a host of suppliers. A total of 50 local and foreign firms employ 4,800 workers in what is now "recognized as the strongest Mexican aerospace cluster," Negocios reports.

Increasing labor costs in China, and Mexico's low transportation and logistic costs for the Western Hemisphere, its available human capital, and its respect for intellectual-property rights are all conspiring to attract investors. But none of it would be happening without the opening to foreign trade and investment.

It is true that Mexico has not grown fast enough to satisfy its young population. But that's because Mexican competitiveness needs work. Crucial sectors like telecommunications, electricity and oil have to be deregulated to lower costs; and further opening to competitors like China is necessary.

This will entail tough domestic political battles which, if won, will make Mexico a stronger, wealthier democracy and a better U.S. neighbor. A new wave of protectionist thinking out of Washington is not going to be helpful to market liberals who are trying to stay the course.

I agree with the benefits of free trade. Free trade also includes capital flows, and China's currency is strongly controlled. Its exchange rate policies are exceeding mercantilist and deeply unfair to many Americans productive efforts.

Immelt is not someone whose words carry much weight with me. Amongst the various reason is that IIRC he has been quite a scumbag with regard to trading with Iran. Is that we he means by free trade? Certainly not directly responsive to the question presented here, but still a point that gets on my nerves with regard to him.

True. I agree the article and I agree with the quote within from the GE chairman only for the substance inside the quotation marks, not for his slimy acceptance of crony, public-private anti-equal-protection leadership.

For the question posed, reasonable exceptions to free trade make perfect sense to me in situations such as transactions that empower or enrich our enemies, or transactions to lower costs by manufacturing with coerced labor.

Isolating a regime like Iran economically is a legitimate foreign policy tool. Probably not effective, certainly legitimate and distinct from our approach to trade policies in general.

This anti-NAFTA article, 'not necessarily the view of mises.org', makes a couple of valid points: "genuine free trade doesn’t require a treaty""The worst aspects of Nafta are the Clintonian side agreements"

At the time, I was in the international trade business and believed that a true, free trade agreement could be written on the back of a cocktail napkin, not in a 2000 page document. It is the rest of the Obamacare-like details of NAFTA that were harmful, not the free trade aspect.

On the other hand, the real alternative to free trade agreements is the continuation of trade barriers mostly designed to keep US goods out of other countries.

Using data from the CIA Factbook, we labeled every country in the world by its highest valued export, a.k.a. the commodity that makes the country the most money in the global market. Click on any of the maps below (at the link)to see an enlarged version.

Trade is good. (IMHO) Having Pres. Barack Obama negotiate the details on our behalf is not. Difficult situation for a Republican lawmaker. Giving away sovereignty is a deal killer. No one knows what is in this deal so it is hard to make sense of what is said.

It is funny to see Democrats squirm and split on this, including a falling out between Obama and Warren, and seeing Hillary afraid to take either side and piss off the other.

It is odd to have Obama on the pro-trade side. Maybe he sees it the same way protectionists see it - that it hurts the American worker and the American economy - and that is why he supports it.

True free trade favors both sides of an agreement. Consensual trade by definition benefits both sides. 99% of the words in these agreements spell out not-free trade terms. I believe NAFTA was a 900 page document. I don't want to brag but I could write a free trade on a single side of a cocktail napkin.

Sometimes uneven source Dick Morris says that free flow of labor is in there and I have seen assertions that foreign companies will be able to challenge US environmental standards.

These are things I've heard too. I wonder what a "free flow of labor" looks like if it happens within our existing laws for foreign, legal, documented workers. And I'm not sure that hurts us. The key to our sovereignty is that these agreements do not supercede the US constitution and existing US laws. All trade agreements tend to be opposed based on the threat to our labor and environmental laws. Critics generally claim that international companies will just build the products elsewhere, if we let them, where the laws aren't as strict. All things otherwise equal, they already do that.

I don't see how anyone who builds a factory here thinks they will not be subject to EPA regulations. All it takes is one sentence in the trade agreement: "Nothing in this agreement shall be construed to change or weaken US environmental laws, or labor laws, or immigration laws." It shouldn't even take that.

The WSJ (years ago) made a point that global trade is both a) beneficial and b) inevitable. If you don't agree with a), then see b).

If the US cannot compete on an even playing field with Asia or Mexico or whoever, then we have bigger problems than a trade agreement. Global competition might be the only motivator left to correct our over-taxation and over-regulation problems. If we right-size all of that, I don't know anyone who believes the US cannot compete successfully in the global marketplace.

We are down to the fact that this President will negotiate a bad agreement. In that case, vote it it down and let these countries know we are trying to get a better President.

Incredibly complex, no one seems to be upfront as to what's in it, or understand what is in it, and all in secret. It is probably giving away our sovereignty away to a multination trade agreement. Of course big companies probably had a say in its' formulation and the rest of Americans get it handed to us whether we like it or not. So what else is new?

****Julian Assange On TPP: Only 5 Of 29 Sections Are About "Traditional Trade," Covers "Essentially Every Aspect Of A Modern Economy"

Speaking from his 'prison' in the Ecuadorian embassy in London, Wikileaks founder Julian Assange explains the Trans-Pacific Partnership treaty, which would link his home country of Australia with the U.S. economically. "It is mostly not about trade," Assange says. "Only 5 of the 29 Chapters are about traditional trade."

JULIAN ASSANGE, WIKILEAKS: First of all, it is the largest ever international economic treaty that has ever been negotiated, very considerably larger than NAFTA. It is mostly not about trade, only 5 of the 29 Chapters are about traditional trade.

The others are about regulating the internet, and what information internet service providers have to collect, they have to hand it over to companies under certain circumstances, the regulation of labor conditions, regulating the way you can favor local industry, regulating the hospital, health care system, privatization of hospitals, so essentially every aspect of a modern economy, even banking services are in the TPP.

So that is erecting and embedding new ultramodern neoliberal structure over U.S. law and the laws of other countries. And putting it in treaty form.

By putting it in a treaty form, there are 14 countries involved, that means it is very hard to overturn, so if there is a desire, a democratic desire to do it on a different path. For example, to introduce more public transport. Then you can't easily change the TPP treaty, because you have to go back to the other nations involved.

Now looking at that example, what if the government or a state government decides it wants to build a hospital somewhere, and there is a private hospital has been erected nearby.

Well the TPP gives the constructor of the private hospital the right to sue the government over the expect loss, the loss in expected future profits. This is an expected future loss, this is not an actual loss that has been sustained, this is a claim about the future.

We know from similar instruments where governments can be sued over free trade treaties, that that is used to construct a chilling effect on environmental and health regulation laws. For example, Togo, Australia, Uruguay are all being sued by tobacco company Phillip Morris to prevent them from introducing health warnings on cigarette packaging...

It is not even an even playing field, lets say you were going to let companies, make it easier for companies to sue governments, maybe that is right, maybe the government is too powerful and companies should have the right to sue them in certain circumstances.

But it is only multinationals that get this right. U.S. companies that operate in the U.S. in relation to investments that happen in the U.S. will not have this right.

Julian Assange's Wikileaks website is the only place where you can read one of the 29 secret chapters of this treaty. Current TPP negotiation member states are the United States, Japan, Mexico, Canada, Australia, Malaysia, Chile, Singapore, Peru, Vietnam, New Zealand and Brunei. The TPP is the largest economic treaty in history, including countries that represent more than 40 per cent of the world´s GDP.

The debate so far was about fast track trade negotiating authority. Of course we don't want President O negotiating on our behalf, but we also don't want that precedent to be lost on his successors. 536 people can't negotiate.

On the question of what we can do about it if it comes out as a bad agreement: The majority of Dems already oppose it without the defects speculated. A letter signed by half the Republicans would put the President on notice that if it contains the 'other 24 sections', it will be voted down. But say that only if you mean it, not to paint Obama-like red lines.

I am SO tired of bills, laws and treaties not being what they are named. If they put something into a trade agreement that is not in his trade authorization, then amend it anyway, down to its authorized and constitutional sections, and vote it up or down.

Let's make sure US sovereignty versus consenting to world government is on the issues list in the next campaign. That is NOT opposition to trade. And don't give away whatever control of the internet that we still have.

The fact that McConnell is saying the trade deal is about the country and not Obama just shows how corrupt he is. There can be no other explanation that he is for this for pork and for his lobby business cronies.

Just despicable how our own party just washes us down the drain. I expect it from the crats but not from Republican leaders.

Just despicable.

Doug, I take it you go to Repub conventions?

I for one am with the millions who will not vote for the likes of Bush (unless he really changes his tune), Graham, Kasich, Christy, and the like. I will sit home and if Hillary wins she wins. These guys are a loss anyway so no point in voting for them.

McConnell and the other fraud from the other House are corrupt. Just no other explanation folks.

The fact that McConnell is saying the trade deal is about the country and not Obama just shows how corrupt he is. There can be no other explanation that he is for this for pork and for his lobby business cronies.Just despicable how our own party just washes us down the drain. I expect it from the crats but not from Republican

Doug, I take it you go to Repub conventions?

I for one am with the millions who will not vote for the likes of Bush (unless he really changes his tune), Graham, Kasich, Christy, and the like. I will sit home and if Hillary wins she wins. These guys are a loss anyway so no point in voting for them.McConnell and the other fraud from the other House are corrupt. Just no other explanation folks.Give Obama fast track? There not crazy - just corrupt.

Doc, You have this about right. The fast track opposition is really about distrust of the Congress to vote down a bad deal, not the obvious - that this President can't be trusted to negotiate in our best interests.

Bush won't be the nominee IMO, but I have already been wrong on one of these picks.

If it really came down to Bush v. Clinton ... well let's deal with that only if we have to. He isn't going to change, but we aren't going to sit still and let her win either.

Remember the author of the latest Clinton corruption book also has a follow-the-money book coming out about Jeb. So far, Jeb is under-performing in terms of both fund raising and poll numbers, even if he is almost in first place. He hasn't won an election in a long time and doesn't seem to get the framework of this one.

All I can say about trade bills that aren't about trade is vote them down and vote in a better President. We are the United States of America, very recently the largest economy in the world. People should want to trade with us!

One more thought. I guess one other explanation is someone dug up dirt on McConnell or Boehner and is extorting them to push for a deal. Perhaps it is the stick not the carrot. Mark Levin questioned brought up this point.

With anti-free-trade talk rising politically again, it is time (again) to look at the merits of the arguments.

Almost everything you hear from POTUS candidates about trade deals is wronghttp://gregmankiw.blogspot.com/2016/03/almost-everything-you-hear-from.htmlThe new IGM Panel poll of prominent economists asks about this proposition:An important reason why many workers in Michigan and Ohio have lost jobs in recent years is because US presidential administrations over the past 30 years have not been tough enough in trade negotiations.Only 5 percent agree, while 64 percent disagree. (The rest were uncertain or did not answer.) A previous poll asked about this statement:Past major trade deals have benefited most Americans.On this one, 83 percent agreed, and zero percent disagreed.

FYI to the zero-sum, anti-Reagan, static economy supporters that make up a third of the Republican party and 2/3rd of the Democrats: Economic globalization was not caused by one piece of paper (1200 pages in this case), It was already happening!

If not for this one document, our little economy would be chugging along like it's 1956 again. We could build iphones right here in America, they would cost $20,000 each. 3 people would have one, and everything would be fine. We could keep Walmart out and the 5 and dime store open over on main street - if not for NAFTA, currency manipulation in China etc.

Besides that it's false, I have not heard from the opponents of freedom to trade the number of jobs Ohio would have lost if did not pursue free trade with the world.

There is so much bunk thrown around on this subject, from Krugman falsely crediting NAFTA to Democrats to the reversal of roles in this election if the protectionist DT is the Republican nominee.

To complicate matters more, Trump says (paraphrasing) he supports free trade and is just bluffing to get the vote of the protectionists. Hillary says she supports free trade too and is just bluffing to compete for the vote of the Sanders crowd.

Just what our economy needs, more uncertainty along with receding economic freedoms. What conservative wants to let government determine what goods should come in or not at what price and regulate that by levying a tax on the American consumer?

I recall from my export days that we had a million dollar order of modems made in the Twin Cites, ready to ship to Mexico, and then we broke open the boxes and had them disassembled and separated into circuit boards and cases, then needing to be reassembled upon receipt, to fall under a different, less punitive tariff class in third world, pre-NAFTA Mexico. That kind of nonsense is what trade protectionists unknowingly favor.

pasting this here from the 3D thread on SCH for its trade implications:

Adding New Layers to 3-D PrintingAnalysisApril 1, 2016 | 09:15 GMT PrintText SizeAdditive manufacturing, more commonly known as 3-D printing, will become more prominent in several industries, including aerospace, over the next few years. (PAUL CROCK/AFP/Getty Images)Forecast

Additive manufacturing, commonly known as 3-D printing, and other advanced manufacturing technologies will shorten and simplify global supply chains in the coming decades. As they do, manufacturing will migrate back to former and current industrial nations. New technologies will simultaneously prevent developing countries from using low-level manufacturing to bolster economic growth.

Analysis

The world is in the early stages of another industrial revolution, one that could reverse some aspects of globalization. Additive manufacturing, more commonly known as 3-D printing, as well as intelligent industrial robotics and other software-based manufacturing technologies, are reducing the advantage of low labor costs. Eventually, they will fundamentally change how goods are made by enabling manufacturing to move closer to consumer markets and eliminating the need to search for cheap labor or produce and assemble parts in different locations away from the assembly plant. These changes will decrease trade in intermediate goods and components and lessen the need for physical inventories, shortening and simplifying global supply chains in the long run.

Additive manufacturing is a broad term that applies to machines using various techniques, including lasers, heat or ultraviolet light, to build items made of any number of materials. Adding materials layer by layer allows for the production of new and more complex products that are lighter and use less material than those made with molds or other traditional manufacturing methods. Because computer software and digital data control the design, several different products or components can also be made on the same machine. Industries with high-value, low-volume products or parts, including the medical, aerospace and automotive industries, have already adopted this technology and will drive much of its initial development.

Needed Improvements

But to fully integrate additive manufacturing into mainstream commercial production, making actual components and products instead of prototypes, several hurdles still need to be overcome, especially for printing metal parts. Metal printing, unlike plastic printing, is expensive. Costs will need to fall before the technique can be used in manufacturing, especially since the printers currently account for between 40 percent and 60 percent of the total unit cost of sintering-based technologies. (Sintering means binding particles of a material into a solid mass through heat or pressure.) The expiration of key patents in 2014 will help lower the cost of machines that use laser sintering to fuse metal layers together; similar patent expirations in 2009 helped drive down the cost of fused deposition printers, an additive manufacturing technology used for modeling, prototyping and production. However, even if the metal printing machines become cheaper, they will still be slow — today such products take hours or days to print, depending on their size — and mainstream incorporation will remain elusive.

The quality of completed 3-D printed products must also improve enough to remove the need for additional finishing processes. Many additive manufacturing techniques do not meet traditional industry standards for accuracy or uniformity, and they often require additional processing before the part or product can be used for its intended purpose. Developing standards specific to additive manufacturing among all the industry players will be crucial to its wider success.

Of course, these advancements will partially depend on the materials used in the process, including metal, ceramic, plastic or any future materials. As the volume of metal printing increases, so, too, will the demand for a key component: metal powder. The powder must be uniform, free of defects and high quality, regardless of the metal used. Today's powders, even those of the highest quality, are not optimal for 3-D printing. Further investment into material science research and development will be needed to meet the demand for high-quality materials and to help eliminate post-printing modifications.

And indeed, some improvements are already being made. The cost of metal printing is expected to decline as competition grows and technologies mature, and production speed will probably rise rapidly. Likely achievements in the computing are also important, since machines' software programing is equally vital to the entire production process.

However, 3-D printing will have the largest impact on global supply chains when printing multiple materials from the same machine becomes more affordable. Researchers at MIT recently announced the development of an inexpensive multicomponent printer that, though still in its early stages, shows promise. In time, their efforts could enable more parts of a product to be produced in a single location and reduce the number of separate components needed, simplifying supply chains and encouraging the technique's spread to many different sectors.

A Tipping Point

Despite the need for improvements, 3-D printing is already being incorporated into production in several industries. For example, hearing aid manufacturers in the medical industry have switched over to additive manufacturing methods, completely pushing out traditional manufacturers. (Hearing aids' small size makes them ideal for 3-D printing.) Moreover, other major companies, including GE, Lockheed Martin, Boeing, Airbus and Google, are beginning to integrate the technology into their production processes as well. Sales of metal printers nearly doubled between 2013 and 2014. And the aerospace industry will continue to adopt the new techniques to make lighter, stronger structures required for its products.

Over the next two years, progress in 3-D printing technology will benefit the commercial sector. In 2016, GE will launch a new LEAP engine that uses 19 fuel nozzles produced by additive manufacturing. They are simpler and 25 percent lighter, reducing the number of separate parts in the nozzle from 18 to one. GE's success could certainly convince aerospace companies to jump on the 3-D printing bandwagon. Meanwhile, Carbon3D is gearing up to release its continuous liquid interface production method, which enables the printing of polymeric materials at speeds 25-100 times faster than the current rates, to the market this year. Developers of a new method known as high-speed sintering, which uses infrared lamp heating, are expected to release the technique in 2017, similarly increasing metal printer production rates by 10-100 times.

Still, the switch to additive manufacturing in the commercial sector will be gradual, much like it is for the transportation industry, because of the long lifetimes of traditional manufacturing equipment.

Changes in Trade

Additive manufacturing will not be the sole driver of the coming industrial transition that is poised to limit or even reverse globalization. However it, along with the Internet of Things (which at its heart simply connects devices to one another so they can communicate and become more efficient and effective), intelligent industrial robots, artificial intelligence and other technologies, will move manufacturing closer to the point of consumption, shortening and simplifying supply chains by reducing the need to import intermediate goods.

Developed nations, especially the United States, parts of Asia (Japan, China, Taiwan, South Korea and Singapore) and Northern Europe, will be the first to develop and adopt 3-D printing technologies. They will also be the ones to benefit most from the technologies, which will raise the productivity of highly-skilled workforces to the point that assembly, fabrication and processing using cheap labor no longer makes business sense. Put another way, 3-D printing could reverse outsourcing.

Additive manufacturing will change countries' domestic policies as well. For example, China is seeking to end its dependence on foreign technology to promote its own technology sector. Consequently, the incorporation of new 3-D printing methods there will be more rapid than might otherwise be expected. Different production specialties may also become more concentrated by region. Furthermore, U.S. government support and initiatives for additive manufacturing could even be used to benefit the rusting Steel Belt running from Pennsylvania to Michigan, the United States' former manufacturing heartland.

Developing countries may not fare so well as 3-D printing and other technologies diminish their opportunities for growth. As trade moves more toward finished products — many produced in or near consuming nations — there will be fewer chances for developing countries to promote economic development and diversification. As a result, low-end manufacturing's role as a catalyst for industrialization and growth in the developing world may weaken as the next industrial revolution unfolds.

In the past I looked up the company thinking it would be a great investment. Most of my patients particularly the old ones were wearing New Balance sneakers. I wear them too.Turns out the company is private

Manufacturing employment peaked in 1977. NAFTA was passed in 1994. Nafta didn't cause a trend that started 17 years earlier. And Nafta repealed Mexican tariffs; we already had the lowest tariffs. A tariff here is a tax on the American consumer, not on a foreign manufacturer. The Chrysler bailout is a major league stadium subsidy, like o. We crony up with whoever is big and visible or trendy at the expense of everyone else. We have government pick winners and losers with all the best intentions tying to have an economy as efficient as Venezuela, where they run out of beer, milk, gas, water and electric and (except in the opposition) have no idea why.

Oddly, this is a good article printed in the Minneapolis StarTribune today.

Protectionists like Trump and Sanders can't repeal the law of gravity nor can they return manufacturing to the 1950s and 60s. Globalization didn't start with Nafta. We compete with the world and we sell to the world. It's an unrepealable fact. That helps those who compete well and it buries those that are inefficient, stubborn or stupid, such as Chrysler in the 1970s while the Japanese ran right by them. Yes, there will be disruption and that is good except when you are the one being disrupted and refuse to respond and adapt. When GM pays for 10 times as many healthcare policies as it has workers and they spend more on that than all materials combined, they might fail if someone else manufactures smarter and more efficiently. Overall, international trade is inevitable and beneficial. If you don't like the latter, see the former. Whoever you are, you compete in a global market.

'Bring back jobs' promise? It is, quite simply, a lieMidwesterners longing for a return to a manufacturing heyday of the 1960s need to look elsewhere for answers than to the misleading slogans of Sanders and Trump. By Michael J. Hicks MAY 6, 2016 — 11:53PMNEW YORK TIMESThe crowd waved pro-jobs signs when Sen. Bernie Sanders spoke at the Indiana Statehouse in Indianapolis last week.

A primary election swept through Indiana this week. Sen. Bernie Sanders and Donald Trump both won comfortably with some version of a promise to “bring back jobs and manufacturing to America.”

Midwestern voters clinging to this hope need to steel themselves for a letdown. Here’s why:

No matter how you measure it, 2015 was the record year for manufacturing production in the U.S. Right now, manufacturing in the Midwest and across the nation is at record levels. There is no ambiguity on this. Inflation-adjusted dollars are the best measure, but by any available metric, we are at record manufacturing production. We’re just doing it with far fewer workers.

The Midwest (Great Lakes Census Region) has lost 2.5 million manufacturing jobs since our peak year of factory employment back in 1969. The U.S. has lost 7.5 million manufacturing jobs since 1977, when manufacturing employment peaked nationwide.

These are facts deviously hidden in every public library in the country and on the Internet, accessible only via the 550 million smartphones and computers in use in America.

Did NAFTA cause these job losses? Well, NAFTA was implemented in 1994, so if Sanders and Trump are to be believed, American firms must have anticipated NAFTA by some 20 years (so much for all that short-term thinking on Wall Street). Moreover, in the 45 years since peak manufacturing employment, the Midwest has created more than 6.1 million nonmanufacturing jobs and the U.S. has created roughly 75 million jobs.

To be sure, our trade deficits have cost us manufacturing jobs. The high-end estimates are that today we have 1.5 million fewer manufacturing jobs across the nation because of foreign trade. All of the other 6 million or so lost manufacturing jobs are due to mechanization, better technology and better production practices. Today, the typical factory worker makes twice as much “stuff” in an hour as he or she did in 1977.

For every manufacturing job lost to trade, nearly nine have been lost to machines. But trade also creates jobs. We have 7 million more transportation and logistics jobs alone, likely attributable to trade growth since the 1970s.

But that is sophisticated analysis, and this is a column about Sanders and Trump, so I’d better stop there.

Quite simply, for every manufacturing job lost since the 1970s, we have created 10 jobs elsewhere. And for every job lost to trade we have created 100 more jobs elsewhere.

This isn’t based on fancy econometric modeling or theory. It is simple data and middle-school algebra. Every campaign knows it well, and every voter should.

The “bring jobs back” promise is simply a lie. It isn’t blue-collar workers in Juarez or Beijing who have stolen factory jobs. Folks with master’s degrees in robotics working in Palo Alto, Calif., have taken those jobs. The only way to get those jobs back would be to adopt Sanders’ energy policies, which would leave many places without electricity.

There may be noneconomic reasons to support these candidates (a longing for a Syria invasion, perhaps, or for heat-free Tuesdays in February). But Midwest voters looking for a return to the 1960s factory scene richly deserve the bitter and lasting disappointment that awaits them.

Back up on my trade soap box, comparative advantage goes back a ways! Maybe these materials were acquired through rape and pillage, but my point about free trade today stands. Comparative advantage exists in more ways than populist, protectionist politicians (or bureaucrats) can see.

"soulless globalism that treats humans as interchangeable widgets in the world market" - from a Jeff Sessions comment. To the naked eye, perhaps, but innovation works best when it runs freely. So do economies and trade arrangements.

All voluntary trade requires mutual benefit (or why would either side do it). Therefore every trade transaction benefits both sides, even those of the imaginary 'trade deficit' type.

The alternative to free trade is to have bureaucrats, technocrats and cronycrats devise a mostly static system in a phony attempt to bring advantage to their own in a way that is smarter than a free market can do it. Good luck with that. Look at history. Those who were the explorers, traders prospered, while those who closed trade borders for an enclosed economy were the economic losers. Compare Denmark and Albania.

The benefit you receive when your competitor beats you to an innovation or efficiency gain and you lose all your customers is not immediately apparent for you to see! But yes, you benefit from competition, even global competition. Is a steelworker from Youngstown Ohio a "steelworker", or is it a person with brain and brawn, a need to support a themselves and a family and the ability to constantly learn new skills that apply to an ever-changing world? Do we want the security that we will never change what we do or what we build decade after decade, generation after generation, in a centrally planned, failed state, or do we prefer growing our knowledge, skills and incomes in a free and dynamic economy?

Fortunately or unfortunately, it is a false choice. If you stand still and try to erect artificial protections and mandate that people buy from you or tax them when they don't, you only delay the inevitable, not prevent it. If you are not competitive and refuse to change, you will perish, not stand still, economically. This is not hyperbole but observable fact. You can buy votes with (false) promises but you can't buy prosperity for what is no longer competitive. Examples of failure to innovate replaced by a government program, the Soviet Union and 100 million working age people not working in this country today. It simply does not help the people it is designed to help.

ccp from the thought pieces thread:"But Reagan utilized some protectionism. At least when it came to national security. Was Reagan wrong with this?"

I agree with Reagan on national security exceptions to free trade. His other exceptions less so.

Reagan was President when I entered the export business. We were selling high tech products globally. I was 'online' with export license applications. In the case of some countries, you had to submit an application and wait for all the relevant department to respond to it. The same semiconductor programming system that tells an elevator exactly where each floor is might also be used in a weapons control system. A ban on anything that might remotely be used to aid an enemy is common sense and completely acceptable.

We used opposite strategies on trade with Cuba and China and both failed. Still I find it perfectly acceptable to ban trade that enriches an oppressive regime whether they pose a direct threat to us or not.

That said, when you are the greatest country in the world, all trading partners might look a little inferior to you. Let's say one country has crazy low wages by our standards and some other country has coercive slave labor. I would trade with the first, but not the second which is not free trade at all.

Trump is talking a different tune and carving out a different course than Reagan. Trump claims that he can get what he wants by threatening tariffs and not have to impose them. That violates his own rules for deal negotiating. (I read his book!) And it doesn't work. That is not what Reagan did.

We want Mexico to benefit from US trade. We would be FAR better off to have a more prosperous neighbor to the south for many reasons. Not at our expense, mutual benefit. We would be better off if China prospered too.

Reagan of course was not just a theorist, he was an elected politician with constituencies and needs to cut deals in congress to get other things done. These two pieces draw different conclusions:

http://www.cato.org/pubs/pas/pa107.htmlThe Reagan Record On Trade: Rhetoric Vs. Realitya 100 percent tariff was placed on selected Japanese electronics products. "The health and vitality of the U.S. semiconductor industry are essential to America's future competitiveness," he said. "We cannot allow it to be jeopardized by unfair trading practices."...imposition of a special 45 percent tariff over a five-year period (on top of the regular 5 percent duty) on Japanese heavy motorcycles as a favor to Harley Davidson. With less than a year to go in the five-year program, Harley Davidson asked that the tariff be removed.(23) Reagan took the occasion to celebrate Harley's comeback with an appearance at the plant. He declared that "American workers don't need to hide from anyone,"

http://www.cato.org/publications/commentary/reagan-embraced-free-trade-immigrationReagan Embraced Free Trade“Our trade policy rests firmly on the foundation of free and open markets. I recognize … the inescapable conclusion that all of history has taught: The freer the flow of world trade, the stronger the tides of human progress and peace among nations.”It was the Reagan administration that launched the Uruguay Round of multilateral trade negotiations in 1986 that lowered global tariffs and created the World Trade Organization. It was his administration that won approval of the U.S.-Canada Free Trade Agreement in 1988. That agreement soon expanded to include Mexico in what became the North American Free Trade Agreement, realizing a vision that Reagan first articulated in the 1980 campaign. It was Reagan who vetoed protectionist textile quota bills in 1985 and 1988. ...Critics of trade note correctly that Reagan negotiated “voluntary” import quotas for steel and Japanese cars and imposed Section 201 tariffs on imported motorcycles to protect Harley-Davidson. All true. But those were the exceptions and not the rule. They were tactical retreats designed to defuse rising protectionists pressures in Congress.

That he made exceptions for specific reasons and perhaps in error I don't think negates the core principle that he most frequently espoused.

Thank you ccp. There is always more to the story. Looking into this further I find two pieces on the Harley Davidson protection, Japanese motorcycle tariffs.

NY Times announcing the policy, 1983:http://www.nytimes.com/1983/04/02/business/us-raises-tariff-for-motorcycles.htmltariffs will rise by 45 percentage points, to 49.4 percent, in the first year. But the rate will be scaled back to 39.4 percent in the second year; to 24.4 percent in the third year; to 19.4 percent in the fourth year, and to 14.4 percent in the fifth year, according to the order. After the fifth year the tariff returns to 4.4 percent.The order, however, permits 5,000 motorcycles to come in without duty increases from West Germany, and provides for increases to 6,000, 7,000, 8,500 and 10,000 in the four subsequent years.

- Yes this was Reagan but look at it. Do we really want Washington DC technocrats in conjunction with the company being protected telling us exactly how many BMW motorcycles and what engine sizes we may buy - during an economic expansion? Like the 1979 Chrysler bailout, this is not government governing but designing the economy, preventing the future and preserving the past. Yes, we want to keep those jobs. No, we don't want a centrally planned and controlled economy. Are we better off for ALL of the cronyism actions taken in their entirety in our economy? No! Would we better off with government that as limited (by an upheld constitution) to play referee, maintain a level playing field role instead of constantly jumping in as a participant? Yes!

And it wasn't necessarily because Harley had become so profitable and strong that it requested the tariffs be lifted. Because Honda and Kawasaki had manufacturing plants here, they also enjoyed trade protection from their overseas rivals. With the probability they were shifting production to those U.S. plants, Harley risked seeing its competition get even stronger the longer the tariffs remained in place. (The tariffs were phasing out anyway. I would suggest they ended them early for PR/publicity reasons.)..Presidential politics are raising the specter of protectionism as a valid policy option once more, but using Harley-Davidson as a case study to validate them indicates that perhaps the wrong history lesson has been learned.

Also note that the program as designed only delayed the market consequence, did not protect against long term comparative advantage.

Foreign trade took a beating at both major party conventions, with speakers blaming free-trade agreements for all but wiping out U.S. manufacturing and eliminating millions of middle-class jobs. Both Donald Trump and Hillary Clinton have promised to renegotiate or abandon trade agreements with key U.S. trading partners such as Mexico and Canada. That would be a colossal mistake.

The number of manufacturing jobs in the United States has indeed been in a long decline since the late 1970s, but that disguises the true story of American manufacturing. Nostalgia for a bygone era blinds politicians and voters alike to the reality of a revitalized sector of the American economy that is thriving in a global market.

American factories and American workers are making a greater volume of stuff than ever — high-tech, high-value products that are competitive in markets around the world. In the last 20 years, which include enactment of the North American Free Trade Agreement and China’s entry into the World Trade Organization, real, inflation-adjusted U.S. manufacturing output has increased by almost 40%. Annual value added by U.S. factories has reached a record $2.4 trillion.

What has changed in recent decades is what our factories produce. Americans today make fewer shirts, shoes, toys and tables than we did 30 years ago. Instead, America’s 21st century manufacturing sector is dominated by petroleum refining, pharmaceuticals, plastics, fabricated metals, machinery, computers and other electronics, motor vehicles and other transportation equipment, and aircraft and aerospace equipment.

We produce more manufacturing value with fewer employees than in years past because today’s workers are so much more productive. They are better educated, equipped with more sophisticated capital machinery and turn out more valuable products than their parents’ generation. And as a result they are better paid, with total manufacturing payrolls rising during the last decade even as the number of workers declined.

The political anger about lost manufacturing jobs should be aimed at technology, not trade.The political anger about lost manufacturing jobs should be aimed at technology, not trade. According to a recent study by the Center for Business and Economic Research at Ball State University, productivity growth caused 85% of the job losses in manufacturing from 2000 to 2010, a period that saw 5.6 million factory jobs disappear. In that same period, trade accounted for a mere 13% of job losses.

In fact, globalization and trade agreements have made a huge contribution to the ongoing success of American manufacturing. Access to expanding global markets allows U.S. manufacturers to enjoy economies of scale, reducing their per-unit production costs and enhancing their competitiveness. The additional revenue can be reinvested in research and development, leading to new products and expanding market share. This is why U.S. jobs in trade-oriented industries typically pay 18% more than non-trade-connected jobs.

Imports also play a critical role in the success of U.S. manufacturing. Measured in terms of value, more than half of what Americans import each year is not for consumption but for production. Being integrated into global supply chains allows U.S. manufacturers to source more affordable parts, components, raw materials and production equipment, making their final products more competitive. Hiking up tariffs on imported steel, to cite just one of Trump’s recent proposals, would raise production costs for a broad swath of U.S. industry, from autos to appliances, making them less competitive at home and abroad.

Like technology, globalization has allowed American manufacturing workers to “trade up” to more challenging and better-paying work. It has enabled the American manufacturing sector to specialize in what we do best: making products that embody American engineering and innovation. And thanks to trade agreements and lower trade barriers generally, we can then sell more of what we make to people in other countries, in exchange for apparel and other lower-tech products that we make less of but still need. In that way, trade blesses Americans twice over: It creates a better mix of jobs and delivers lower prices for everyday consumer goods.

Global trade has put some Americans out of work. But the total numbers are small compared with the overall national job churn. Indeed, millions of U.S. jobs are eliminated each year by technology and changing consumer tastes, only to be replaced by new jobs that are being created by the same dynamic forces.

The right response to anxieties about trade is to invest more in education, retraining and enhanced labor mobility, not to pick trade fights with other nations that would put in jeopardy the success of America’s modern, competitive manufacturing sector.

Daniel Griswold is a senior research fellow and co-director of the Program on the American Economy and Globalization at the Mercatus Center at George Mason University.

If elected, I think he is threatening to be a loose cannon to scare rivals, adversaries and allies into concessions on trade and other things. But he is promising us a better deal for America. Consumers facing huge tariffs and a federal government trying to 'protect' jobs and pick winners and losers in the private economy is another Great Depression waiting to happen. That is not a better deal for America and would be catastrophic for the world.

Too bad Hillary doesn't have the [balls?] to stand up for any of the policies that worked for President Bill Clinton. Maybe it's lucky for us that she keeps taking Bernie's side of the Democratic split on the issues so that people other than leftists won't be tempted to support her.

It is true that the number of manufacturing jobs in the United States has been in steep decline for almost a half-century, but manufacturing employment disguises the true story of American manufacturing. U.S. manufacturing output has increased by almost 40 percent. Annual value added by U.S. factories has reached a record $2.4 trillion. ...Political anger about lost manufacturing jobs should be aimed at technology, not trade. ...In 1790, farmers were 90 percent of the U.S. labor force. By 1900, about 41 percent of our labor force was employed in agriculture. Today, less than 3 percent of Americans are employed in agriculture. ...There's one thing to keep in mind. Losing a job due to outsourcing or losing it to technological innovation produces the same result for an individual: He's out of a job. The best thing that we can do is to have a robust economy such that he can find another job.